Cyprus government officially targeting Schengen accession in 2026. Technical evaluations ongoing. Once effective, Cyprus residency will likely grant visa-free travel to 29 Schengen countries. Currently requires visa for Schengen travel.
Citizenship PERMANENTLY closed (2020 scandal). Residency active €300K + €50K income. EU member targeting Schengen 2026. Mediterranean lifestyle. Non-dom tax benefits.
Citizenship closed, residency active, Schengen target year
Cyprus represents a cautionary tale and potential opportunity in residency-by-investment. The country's aggressive €2M+ citizenship-by-investment program (2013-2020) ended in scandal when Al Jazeera investigation exposed corruption, inadequate due diligence, and passports sold to criminals and sanctioned individuals. EU Commission threatened legal action. Cyprus permanently terminated citizenship program November 2020.
Residency permit remains ACTIVE - €300K investment (Category 6.2 Permanent Residence) grants indefinite residence but NOT citizenship or passport. Key 2026 development: Cyprus officially targets Schengen Area accession in 2026. Technical evaluations ongoing. Once effective, Cyprus residency will likely provide visa-free access to 29 Schengen countries - significantly increasing value.
Current reality: Cyprus is EU member but NOT Schengen, meaning residency does NOT grant current Schengen visa-free access. However, if you invest now and Cyprus joins Schengen later in 2026/2027, your existing residency permit would gain this benefit retroactively - potentially making Cyprus a strategic "waiting room" investment.
Closed citizenship vs active residency clearly distinguished
Fast-track citizenship terminated Nov 2020
Permanent residence permit (NOT citizenship)
Minimum €300,000 investment (plus VAT) in ONE of:
Additional €30K deposit: Must place €30,000 in fixed deposit at Cyprus bank (3-year term). This is IN ADDITION to €300K investment, bringing total to €330K minimum.
Income Requirement (2026 Increase):
Timeline of €2M "Golden Passport" scandal and closure:
EU Pressure Context: Cyprus program considered worst offender among EU golden passports. Malta tightened compliance (program survived with reforms). Bulgaria closed investor citizenship. EU generally disapproves citizenship-for-sale but tolerates residency programs with proper vetting.
What €300K Category 6.2 permit actually requires
| Requirement | 2026 Details |
|---|---|
| Age | 18+ years old (main applicant) |
| Investment | €300K+ (new residential, commercial resale, company shares, or funds) + €30K bank deposit |
| Annual Income | €50K main + €15K spouse + €10K per child (from abroad, secure source) |
| Background | Clean criminal record globally, no security threats (enhanced vetting post-scandal) |
| Health Insurance | Valid health coverage in Cyprus (EU coverage accepted) |
| Visit Requirement | Once every 2 years minimum to maintain permit |
| Annual Confirmation | Proof investment maintained + valid health insurance (NEW 2026 requirement) |
| Employment | Cannot work as employee. Can be paid Director/shareholder (dividends, management fees OK) |
NEW ongoing compliance obligation:
Cyprus now requires permit holders to submit annual confirmation demonstrating:
Failure to submit annual confirmation: Can result in permit cancellation. This is stricter than many EU programs (Greece, Portugal no annual reporting). Cyprus increased oversight post-citizenship scandal to demonstrate proper program management.
Cyprus Permanent Residence includes family members:
Income Add-ons: €15,000 for spouse, €10,000 per child, €8,000 per parent. Example: Family of 4 (2 adults, 2 children) requires €50K + €15K + €20K = €85,000 annual foreign income.
Family members receive same permit rights: Can live in Cyprus indefinitely, access healthcare/education, travel with main applicant. All subject to same visit requirement (once every 2 years).
Cyprus citizenship available through naturalization (NOT investment) after extended residence:
Timeline & Residence:
Language & Integration Requirements:
Discretionary Approval: Unlike direct citizenship-by-investment (closed), naturalization is discretionary. Cyprus Ministry of Interior evaluates applications. No guarantee of approval. Greek language proficiency particularly important.
Cyprus Passport (Post-Citizenship): Ranked 15th globally (174 visa-free countries). Weaker than Greek (184), Portuguese (194+), Italian (194+). Allows dual citizenship.
Cyprus officially targeting Schengen membership this year
Cyprus government officially set 2026 as target year for Schengen Area accession:
Current Status (Pre-Schengen):
Post-Schengen Scenario (If 2026 Goal Achieved):
Strategic Consideration: Cyprus residency currently LESS attractive than Greece due to no Schengen. However, if you invest in 2026 and Cyprus joins Schengen later in 2026/2027, your permit becomes significantly more valuable. This makes Cyprus a potential "waiting room" investment for those willing to accept near-term limitation for medium-term Schengen access at lower cost than alternatives.
Risk: Schengen accession NOT guaranteed. Northern Cyprus territorial disputes could delay indefinitely. Do NOT invest based solely on Schengen hope - invest only if Cyprus residency valuable to you even WITHOUT Schengen.
Non-dom status and favorable tax environment
Cyprus offers exceptional tax benefits for new residents through "non-dom" status:
Example: €500,000 annual dividend income. Standard Cyprus tax: €85,000 (17% SDC). With non-dom status: €0 tax. Annual savings: €85,000 for up to 17 years.
Perfect for: Investors with substantial dividend/interest income from abroad. Retirees with investment portfolios. Business owners receiving dividends from international companies. Ultra-high-net-worth individuals with passive income.
How to qualify: Become Cyprus tax resident (183+ days/year OR domiciled) + Not domiciled in Cyprus for 17 of last 20 years (most new residents qualify automatically).
Corporate Tax: 12.5% (among lowest in EU). Extensive tax treaty network (65+ countries). IP box regime: 80% exemption on qualifying intellectual property income (effective 2.5% rate). Perfect for holding companies, IP structures.
Personal Income Tax: Progressive rates 0-35% on employment/business income. First €19,500 tax-free. €19,501-€28,000 at 20%. €28,001-€36,300 at 25%. €36,301-€60,000 at 30%. Above €60,000 at 35%.
No Wealth/Inheritance/Gift Tax: Cyprus does NOT tax wealth, inheritance, or gifts. Major advantage for estate planning. Transfer wealth to heirs tax-free.
Social Insurance: If not working in Cyprus (permitted as residency holder), no social insurance contributions required. Significant savings vs countries requiring payments.
Strategic assessment of Cyprus residency in 2026
Cyprus makes sense if you:
Cyprus NOT recommended if you:
Direct comparison to closest competitor:
Cost: Cyprus €300K vs Greece €400K-€800K (Cyprus cheaper)
Schengen: Cyprus 2026 GOAL vs Greece YES NOW (Greece better currently, Cyprus potentially equal later)
Income: Cyprus €50K required vs Greece NONE (Greece better)
Work Rights: Cyprus NO employee status vs Greece YES (Greece better)
Annual Reporting: Cyprus YES (investment + insurance) vs Greece NO (Greece better)
Tax Benefits: Cyprus non-dom 0% dividends/interest vs Greece standard (Cyprus MUCH better for HNWIs)
Citizenship: Cyprus 8 years + Greek language vs Greece 7 years + Greek language (similar difficulty)
Passport: Cyprus 174 visa-free vs Greece 184 (Greece stronger)
Verdict: Greece superior for most investors (Schengen NOW, no income requirement, can work). Cyprus superior ONLY for ultra-high-net-worth with substantial passive income prioritizing tax optimization over Schengen access, OR for those specifically preferring Cyprus island lifestyle and willing to bet on 2026 Schengen accession.
CIVITAS provides expert guidance on Cyprus permanent residence (€300K + non-dom tax benefits) and comparison to active EU programs with immediate Schengen access (Greece, Portugal, Malta). Navigate 2026 Schengen uncertainty with informed strategy.